How long after settling an accident claim must an attorney issue a payout?

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How long after settling an accident claim must an attorney issue a payout?

I settled in an accident case. I signed the papers at my lawyers office. It’s been 3 months and I feel my lawyer is prolonging the payout. Could he be prolonging the payout earning interest on the money, or waiting for years end for tax purposes?

Asked on December 15, 2010 under Accident Law, Pennsylvania

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

There isn't any set amount of time for the attorney to receive the settlement check and distribute the funds. Three months is too long.  There may be some delay with the insurance carrier issuing the check.  It would be advisable to call the attorney's office and inquire about the status of your settlement check.

It is unlikely that the attorney would be holding the funds because the check should be deposited in the attorney/client trust account.  Interest from that account does not go to the attorney.  Interest from that account goes to the State Bar. 

When a settlement check is received, the attorney deposits it in his/her attorney client trust account.  The attorney then writes the following checks: a check to the attorney, checks to those who had a lien on the settlement such as doctors, ambulance, hospital, etc. and a check to the client for the balance.  All of these checks are usually written at the same time.

It is also possible that there may be a dispute with a doctor or other party who has a lien on the settlement funds as to the amount of the lien.  That would be a reason for the attorney to hold the settlement check in the attorney/client trust account until the disputed amount of a particular lien has been resolved.  If the attorney distributed the funds prior to that dispute not having been resolved, there may not be sufficient funds remaining to pay the appropriate amount of the lien when that issue is resolved.


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